The Grant Williams Podcast · Wednesday, July 8, 2026
Brent Johnson delves into the mechanics of the Eurodollar market, describing it as the credit extended globally using dollars. He explains that the entire system operates on a 'carry trade' basis, where borrowing in dollars and investing elsewhere is common. Problems arise when the dollar strengthens significantly, making these dollar loans more difficult to repay for non-US entities.
“And the reason that's important, and this is what I tried to explain in detail in the different chapters of the paper, and this gets into the band that we were talking about.”
“And so the world, for better or worse, has chosen to use dollars. And so the whole world runs this dollar carry trade.”
“And the dollar market outside the United States is infinitely larger than the dollar market inside the United States. And the dollar market outside the United States, we refer to as the Eurodollar market. That entire market is credit. It is all just credit that has been extended.”